Global Fintech Report Q1 2019

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June 11 - 13, 2019
New York, NY

events.cbinsights.com/future-of-fintech

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events.cbinsights.com/future-of-insurance
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Contents
9 Q1’19 Financing Trends
Quarterly Deals & Dollars
Regional Trends
Q1’19 Top VC-Backed Fintech Deals
Fintech Unicorns

21 Q1’19 Fintech Sector Trends

64 Appendix:
Major markets financing trends
Most Active Fintech Investors Q1’18 - Q1’19
Methodology

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 Summary of findings
Q1’19 VC-backed fintech funding dropped but deals remain strong: In the
first 3 months of 2019, VC-backed fintech companies raised $6.3B across
445 deals globally. Deals were up 4% quarter-over-quarter (QOQ) while
funding dipped 13%.
Asia saw funding fall as a result of tighter regulatory oversight in China:
Fintech funding in Asia fell below $1B for the first time in five quarters.
Funding dropped to $875M, a 67% drop QOQ. Deals grew to 127 supported
by strong growth in India, which saw 29 deals.
Late-stage deal share grew to a 5-quarter high as investors continued to
concentrate bets in perceived winners: Global Series D and Series E+
fintech deals grew to 8% in Q1’19. US early-stage deal share was flat QOQ
as investors continued to concentrate their bets in established fintech
unicorns.
There are 41 VC-backed fintech unicorns worth a combined $154.1B:
Q1’19 saw three new unicorn births (N26, Chime, and Airwallex) and three
in the first month of Q2’19 (Bill.com, Liquid, and Lemonade). The cohort’s
total valuation in 2019 continues to grow as a result of continued mega-
rounds to existing unicorns, including Klarna and Stripe, among others.
India challenges China for the top Asian fintech market: India was the top
Asian market for VC-backed fintech funding in Q1’19 with $286M in
funding, narrowly surpassing China. China saw funding fall to $192M, a 89%
drop QOQ. India and China both saw 29 deals.
In Q1’19, Europe beat Asia in funding and the US remained the top market
for deals with 170 investments worth $3.3B: Europe saw funding grow to
$1.7B, surpassing Asia which saw $875M in funding in Q1’19. Asia saw 127
deals, beating out Europe.
Q1’19 saw record M&A deals between payment incumbents, more fintech
mega-rounds to support staying private, and lackluster IPO activity: The
quarter saw 2 record-breaking acquisitions between payment incumbents:
Fiserv acquired First Data for $41B in January and FIS acquired Worldpay
for $43B in March. Q1’19 saw 13 $100M+ financing deals to VC-backed
fintech companies. Q1’19 only had 1 unicorn IPO with Tiger Brokers.
Note: This report focuses on equity rounds to VC-backed fintech companies. This report does not cover
companies funded solely by angels, private equity firms, or any debt, secondary, or line of credit
transactions. All data is sourced from CB Insights.
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 WHAT THIS REPORT COVERS

Payments processing, card developers, Companies selling insurance digitally or providing

& subscription billing software tools data analytics and software for (re)insurers

Tools to manage bills and track Sales & trading, analysis, and infrastructure
personal and/or credit accounts tools for financial institutions
PAYMENTS/ INSURANCE
BILLING
PERSONAL CAPITAL
FINANCE MARKETS
Audit, risk, and regulatory Investment and wealth management
compliance software platforms and analytics tools
WEALTH
REGTECH MANAGEMENT

Companies leveraging blockchain MONEY International money transfer

technologies for financial services BLOCKCHAIN/ TRANSFER/ and tracking software
CRYPTO REMITTANCES

MORTGAGE/
LENDING REAL ESTATE
Marketplace lending & alternative Mortgage lending, digitization,
underwriting platforms and financing platforms
GLOBAL FINTECH
REPORT Q1’19

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GLOBAL FINTECH DEALS AND DOLLARS START 2019 STRONG

Global fintech funding hit $6.3B in Q1’19

Annual global VC-backed fintech deals and financing, 2015 – Q1’19 ($B)

1,829

1,564

1,304
1,191

445

$16.5 $19.4 $18.3 $40.3 $6.3

2015 2016 2017 2018 2019

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Q1’19 DEALS CLOSE TO RECORD HIGHS

VC-backed fintech deals rebounded in Q1’19 after dip

Quarterly global VC-backed fintech deals and financing, Q1’15 – Q1’19 ($M)
470 466 466
445
427
405
391 386 382

342 350
326
313 315
299 284
266

$2,970
$2,764

$2,319

$2,561

$20,750

$6,110
$4,997

$6,417

$5,402

$8,495

$5,797

$4,649

$4,563

$6,174

$6,320
$7,282
Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 $3,266
Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

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Europe pulled ahead of Asia for fintech funding for
the first time in five quarters
Global VC-backed fintech funding by continent, Q1’18 – Q1’19, ($M)
South America
$210.8
$33.9 $72.0
$25.4 $42.6 Australia
$20.7 $11.2
$278.8 $61.3 $130.6
$204.7 $803.7
$56.6 $66.9 Africa
$942
$0.6 $30.3
$1,083.3 $804.9
Europe
$1,713.0

$2,203.8 * $2,612.6 $874.7 Asia

$1,928.7
$2,159.3

North America

$2,595.4 $3,483.6 $3,120.9 $3,571.8 $3,492.0

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

*Ant Financials' $14B round in Q2’18 was excluded from the chart represented on this slide for illustrative purposes 11
Q1’19 fintech deals fell below Q1’18 totals in most
markets
Global VC-backed fintech deals by continent, Q1’18 – Q1’19
228
197
189 20
183
163
157
147 16
131 127 14 14
120
103 102
119 10
82 86 9
8 8
7 8
7
8 5
4
2

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19
North America Asia Europe Africa Australia South America
Note: Charts not to scale 12
Mega-rounds continued in Q1’19, boosting late-
stage fintech deal share to a 5-quarter high
Annual deal share by stage to global VC-backed fintech companies, Q1’18 – Q1’19

9% Other
12%
15% 16% 16% 8% Late-Stage
7% 5%
6% 6%

Mid-Stage
20%
18% 23%
20%
24%

Early-Stage

60% 58% 54% 63% 60%

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

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FINTECH MEGA-ROUND INVESTMENTS REMAINED STRONG IN Q1’19

Q1’19: 13 fintech mega-rounds total $2.36B

Global number of fintech mega-rounds ($100M+), Q1’18 – Q1’19
11

7 7 7

5
4 4 4 4
3 3

1 1 1 1 1 1 1

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

North America Asia Europe South America Australia

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Top 9 global fintech deals in Q1’19
The top deals to VC-backed fintech companies were all mega-rounds ($100M+)
Deal Date // Total Disclosed
Company Amount Raised Funding Select Investors Description

Jan’19 // $500M $925M Greenoaks Capital Management, First Tech-enabled health insurance carrier
($1.2B Valuation) Round Capital, Sequoia Capital

Jan’19 // $300M $512.6M Insight Venture Partners, GIC, Greyhound Digital-first “challenger bank” for retail banking
($2.7B Valuation) Capital services that allows customers to open accounts
remotely using just a mobile application

Mar’19 // $250M $503M Bessemer Venture Partners, Generation Restaurant management system
($2.7B Valuation) Investment Management, Lead Edge
Capital, T. Rowe Price, Tiger Global
Management, TCV
Jan’19 // $240M $250.2M Fifth Wall Ventures, Foundation Capital Tech-enabled title insurance carrier

Mar’19 // $200M $308.8M Coatue Management, Dragoneer, DST, Digital-first “challenger bank” for retail banking
($1.5B Valuation) Forerunner Ventures, General Atlantic, services that allows customers to open accounts
ICONIQ Capital, Menlo Ventures remotely using just a mobile application

*Indicates unicorn deal 15

Top 9 global fintech deals in Q1’19
5 of the top 9 deals went to VC-backed fintech companies in the US
Deal Date // Total Disclosed
Company Amount Raised Funding Select Investors Description

Mar’19 // $125M $164.3M CreditEase Fintech, Goldman Sachs, Tech-enabled insurance platform
Mubadala Ventures, Salesforce Ventures

Jan’19 // $125M $205.9M Benchmark, Index Ventures, Sequoia Open-source data streaming platform
Capital

Mar’19 // $114M $178.2M Index Ventures, PayPal, Ribbit Capital, Wealth management marketplace
Thrive Capital

Jan’19 // $105M $263.8M CNBC, Blackrock, Bain Capital Ventures Digital wealth management provider or robo-
($800M Valuation) advisor

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 GLOBALLY THERE ARE

41 FINTECH UNICORNS
VALUED, IN AGGREGATE, AT

$154.1 BILLION

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 41 fintech unicorns valued at $154.1B
Global VC-backed fintech companies with a private market valuation of $1B+ (4/25/19)
NORTH AMERICA EUROPE ASIA
UNITED STATES CHINA
UNITED KINGDOM GERMANY SWEDEN

$22.5B Valuation $3B

$38B Valuation
$2.36 - $2.8B $1.6B $1.7B $1.27B $2.7B $3.45B
Valuation
$8B $5.3B
$1.5B
$2.9B $4B

$1.4B
$1.1B $1.5B

$1.2B $1B
$3.2B
JAPAN
$1.9B $1.8B

$1B (Q2’19)
$4.5B (as of Q1’17) $2.7B
SOUTH KOREA

$1.2 - $1.6B $1B

$1.2B
$1B (Q2’19) $2B (Q2’19) INDIA

$1B $2.7B
$1B

$2B $2.1B (as of Q2’15) SOUTH AMERICA AUSTRALIA

BRAZIL AUSTRALIA $10B

$1.24B $1B

$1B
$4B Valuation $1B Valuation 18
 Q1’19 saw 3 new fintech unicorn births
NORTH AMERICA EUROPE ASIA
UNITED STATES CHINA
UNITED KINGDOM GERMANY SWEDEN

$22.5B Valuation $3B

$38B Valuation
$2.36 - $2.8B $1.6B $1.7B $1.27B $2.7B $3.45B
Valuation
$8B $5.3B
$1.5B
$2.9B $4B

$1.4B
$1.1B $1.5B

$1.2B $1B
$3.2B
JAPAN
$1.9B $1.8B

$1B (Q2’19)
$4.5B (as of Q1’17) $2.7B
SOUTH KOREA

$1.2 - $1.6B $1B

$1.2B
$1B (Q2’19) $2B (Q2’19) INDIA

$1B $2.7B
$1B

$2B $2.1B (as of Q2’15) SOUTH AMERICA AUSTRALIA

BRAZIL AUSTRALIA $10B

$1.24B $1B

$1B
$4B Valuation $1B Valuation 19
 And Q2’19 is on track to see more new unicorn rounds
NORTH AMERICA EUROPE ASIA
UNITED STATES CHINA
UNITED KINGDOM GERMANY SWEDEN

$22.5B Valuation $3B

$38B Valuation
$2.36 - $2.8B $1.6B $1.7B $1.27B $2.7B $3.45B
Valuation
$8B $5.3B
$1.5B
$2.9B $4B

$1.1B $1.5B Marqeta was finalizing plans to raise at least $1.4B

$1.2B
$250M at a valuation of about $2B, nearly
$3.2B $1B
quadrupling its value from two years ago.
JAPAN
$1.9B $1.8B
March 26, 2019
$1B (Q2’19)
$4.5B (as of Q1’17) $2.7B
SOUTH KOREA

$1.2 - $1.6B $1B

$1.2B
$1B (Q2’19) $2B (Q2’19) INDIA

$1B $2.7B
$1B

$2B $2.1B (as of Q2’15) SOUTH AMERICA AUSTRALIA

BRAZIL AUSTRALIA $10B

$1.24B $1B

$1B
$4B Valuation $1B Valuation 20
 Q1’19 Fintech
Sector Trends

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#AhaCBI
 GLOBAL VC-BACKED
FINTECH Q1’2019

CAPITAL INSURTECH
MARKETS REGTECH

WEALTH PAYMENTS
MANAGEMENT

DIGITAL
BANK TECH
BANKING

MACRO SECTOR
TRENDS

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 GLOBAL VC-BACKED
FINTECH Q1’2019

DIGITAL
BANKING

MACRO SECTOR
TRENDS

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 Challenger banks continued funding tear in Q1’19
VC-backed deals and financing trends to digital banking startups, Q1’18 – Q1’19 ($M)
$1,100.0 26

$900.0 21

18
17 17
$700.0 15 16

11
$500.0 11

$300.0 6

$100.0 1

$734.2 $472.4 $277.6 $449.7 $704.6

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

$(100.0) -4
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Challenger banks continue to spread globally

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Challenger banks are no longer a niche in fintech
Digital banking companies have attracted millions of customer accounts (in thousands)

5,000

4,000

3,000

2,300

1,700
1,500
1,300
796
500 500 600 600 600
450
100 120 150 200 210
56
Tide Loot Lunar Way Pockit Greenlight Starling Varo Acesso Uala Monese Tandem Neon Gimi Qapital NuBank Monzo N26 Chime Revolut NuBank
Financial Bank NuCanta
Nu Canta

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A host of different
Digital challenger banks deal flow continued in Q1’19
challenger bank
startups raised
equity funding in
Q1’19.
The top two 0
rounds to
challenger banks
minted new
unicorns, N26 and
Chime.

Note: This chart includes non-VC-backed equity investments 27

BREAKING GROUND IN NEW MARKETS

RETAIL, FREELANCE, & BUSINESS ACCOUNTS

Last Funding Valuation
$300M Series D // Q1’19 $2.7B
N26 is a licensed challenger bank based in Germany
that has amassed over 2.3M reported retail
customers since launching in 2014.
N26 has been leveraging the European Economic
Area’s banking passport to expand to other EU
countries. N26’s core products include a mobile app,
digital checking and savings accounts, and
connected debit card supported by Mastercard. N26
also offers business, freelance, and premium
accounts. Next up, N26 is expanding in the US and BANK ACCOUNT FEATURES
the UK and considering Latin America. In the US, they
are looking to launch cash back rewards.
Select Investors
Insight Venture Partners, Allianz X, Tencent
Holdings, Valar Ventures
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BANKING ON MILLENNIALS

Last Funding Valuation

$200M Series D // Q1’19 $1.5B

Chime is a mobile banking app that provides a

checking account-like service through a
partnership with Bancorp and debit cards
through Visa. The account is free to open and
provides $0 ATM access and overdraft
protection. Additional services include a two-
day payday advance for customers that direct
deposit their paycheck to Chime and optional
round ups savings accounts.
In April 2019, Chime reported the company had
opened 3M accounts.

Select Investors
Crosslink Capital, Forerunner Ventures, Menlo Ventures,
Northwestern Mutual Capital, Omidyar Network, Homebrew
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CONSUMER CREDIT REMAINS AN AREA OF OPPORTUNITY FOR TECH STARTUPS

Last Funding Valuation

$34M Series D // Q1’19 $107M

Petal is an alternative credit card issuer with 100,000

pre-launch sign-ups as of October 2018. Petal targets
the 65M Americans that are uncreditworthy or are
“credit invisible” and do not meet the traditional
qualifications for a credit line with a bank. Petal’s
back-end bank partner is Web Bank.
Petal uses an in-house algorithm that leverages
machine learning and supplemental data (like income,
short-term debt, and outstanding loans) to
alternatively underwrite a consumer’s credit risk.
Select Investors
Ride Ventures, Rosecliff Ventures, Story Ventures, Valar
Ventures, Afore Ventures, Brooklyn Bridge Ventures

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 More cross-over cards to come from every corner
Select insurgent fintech startups and public contenders planning to launch credit and debit cards
PRIVATE FINTECH PUBLIC CONTENDERS
DEBIT
UK only

VS.

CREDIT

Credit Partner TBD

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FROM CARDS TO ACCOUNTS, COULD AN APPLE CHALLENGER BANK BE NEXT?

Apple Card emphasizes privacy over perks

Apple introduced the Apple Card in March 2019 as a pillar in its strategy to bet big on subscription
services. Apple Card prioritizes security over discounts, keeping data & cash in the Apple
ecosystem, and providing services that integrate seamlessly across its software and hardware
stack, consistent with Apple’s broader strategy. Existing incumbents don’t have this.

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 GLOBAL VC-BACKED
FINTECH Q1’2019

WEALTH
MANAGEMENT

MACRO SECTOR
TRENDS

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Wealth tech deals came roaring back in Q1’19
VC-backed deals and financing trends to wealth tech startups, Q1’18 – Q1’19 ($M)
$1,100.0 60

50
$900.0 49 50
46
42
$700.0 37 40

$500.0 30

$300.0 20

$100.0 10
$613.9 $926.0 $525.8 $469.0 $845.1

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

$(100.0) 0
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 ACORNS IS ACTIVELY PURSUING OMNICHANNEL PARTNERSHIPS FOR DISTRIBUTION

Acorns grows to 5M customers with $1B in AUM

+
Last Funding Valuation
$105M Series E // Q1’19 $860M
Q1’19 announcements:
• Acorns took a strategic investment from NBC Universal
• NBC Universal started creating financial literacy content
for Acorns Grow as part of the investment
• Acorns Spend debit card went live
• To increase offline visibility, Acorns sponsored Roush
Fenway Racing to partner with Nascar driver Ryan Newman
Select Investors
NBC Universal, Blackrock, Paypal, Bain, Nyca, The Rise
Fund, Sound Ventures, Greycroft, Point 72, e.Ventures

SELECT PARTNERSHIPS

Jan’19 Feb’19 Jun’18 Feb’18

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 STASH IS LOOKING TO DIVERSIFY INVESTMENT OFFERING

Stash adds 2.5M accounts and active investments

Last Funding Valuation

$65M Series E // Q1’19 $405M
Q1’19 announcements:
• Stash added “stock back” rewards, linked to its spending
cards, which are fractional investments in diversified ETFs
on a rotating basis
• In one month, Stash fulfilled 500K rewards
• Stash bank accounts and debit cards went live
Select Investors
Union Square Ventures, Valar Ventures, Breyer
Capital, Coatue Management, Entree Capital,
Goodwater Capital
BANK PARTNER

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 Early-stage wealth tech startups are diversifying
investing beyond the robo-advisory stack in the US
Select Q1’19 wealth tech deals

Focus: Diversifying IRAs with Focus: 1099 and gig-economy Focus: Retirement planning Focus: Financial healthcare and
alternative asset classes benefits platform and income distribution wellness benefits for employers
Q1’19 Funding: $2.8M Seed Q1’19 Funding: $5.1M Series A Q1’19 Funding: $1M Series A-II Q1’19 Funding: $2.8M Seed
Select Investors: Sequoia Select Investors: NYCA, Khosla Select Investors: Inspired Select Investors: PJC, TT
Capital, Fondation Capital Ventures, Kindred Ventures Capital, Anthemis, Point72 Venture, Y Combinator
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 GLOBAL VC-BACKED
FINTECH Q1’2019

CAPITAL
MARKETS

MACRO SECTOR
TRENDS

38
Capital markets tech deals grew but funding drops
with shift to M&A deals in Q1’19
Global capital markets tech VC-backed fintech financing trends, Q1’18 – Q1’19, ($M)
$2,500.0 90
80
80

$2,000.0
70
60 60
55 55 60

$1,500.0
50

40
$1,000.0

30

20
$500.0

10

$1,188.2 $2,104.5 $1,213.6 $1,399 $1,031.4

$- 0
Q1'18 Q2'18 Q3'18 Q4'18 Q1'19
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EQUITY MANAGEMENT IS HEATING UP WITH THE LARGEST DEAL TO-DATE

Morgan Stanley acquires Solium Capital for $900M

to win underwriting business ahead of tech IPOs
Valuation: $1B

Potential opportunities for Morgan Stanley:

• Cross-selling Solium’s clients into the

wealth management business

• Raising the investment bank’s

underwriting business as the tech IPO
market heats up

• Solium acquired Capshare in 2017 which

remains operational

40
 Financial Management Startup Carta Is
Raising $300M From A16Z At A $1.8B
Valuation

Carta helps venture capitalists, as well as startup employees and other stakeholders, track and
manage the shares that they own. It also helps companies manage other aspects of their stock,
such as fair-market valuations and secondary sales.

Carta's product becomes more useful as more startups stay private longer and have more
complicated capitalization tables, though some of its customers have also gone public while
continuing to use the service. The company has plans to expand to help venture capital firms'
limited partners, such as endowments and pensions, manage their portfolios.

41
 Cap markets tech brings private markets out of the dark ages
and protects startup employees
CAP TABLE MANAGEMENT
Q1’19 Funding: $2M Seed // Fuel Ventures
Focus: Capdesk is a private equity management
platform designed to digitize and provide
liquidity for the billions of pounds (GBP) of
employee shares in unlisted European
companies.
Capdesk is similar to Carta’s initial software
offering in the US and is one of a number of
equity management software providers cropping
up globally to help startups, VCs, and employees.
LIQUIDITY
Q1’19 Funding: $35M Series B // Munich Re
Q2’19 Funding: Undisclosed Minority // BNP
Focus: Forge, FKA Equidate, is a settlement and
custody partner for investors and shareholders in the
private markets.
In March 2019, Forge acquired IRA services to expand
into custody and reduce switching friction for users.
In April 2019, Forge partnered with BNP Paribas to
originate and distribute new investments with exposure
to pre-IPO and private markets.
ISSUANCE
Q1’19 Funding: $20M Series B // Citi,
Nasdaq, Galaxy
Focus: Symbiont is a blockchain company
developing products in smart contracts and
distributed ledgers for the capital markets.
In February 2019, Templum partnered with
Symbiont's Assembly for its regulated, end-to-end
solutions for raising capital and secondary
trading platform.
42
GLOBAL VC-BACKED
FINTECH Q1’2019

INSURTECH

MACROS SECTOR
TRENDS

43
Insurtech funding surged on the back of 3 mega-
round investments in Q1’19
Global insurtech VC-backed fintech financing trends, Q1’18 – Q1’19, ($M)
$1,800.0 75

66
$1,600.0 62 65
58
$1,400.0
55

$1,200.0 47 46
45

$1,000.0
35
$800.0

25
$600.0

15
$400.0

$200.0 5

$711.8 $556.4 $1,167.7 $800.6 $1,574.7

$- -5
Q1'18 Q2'18 Q3'18 Q4'18 Q1'19
44
Mutual aid platforms take off in China to
crowdfund medical coverage
SHUIDIHUZHU
Q1’19 Funding: $74M Series B // Tencent, BlueRun Ventures
Focus: Shuidihuzhu is a mutual aid platform in China that allows
members to raise money for diseases that require high medical fees.
Members pay a small upfront fee into a pool of funds that pays out
when a member is diagnosed with a serious disease such as lung
cancer. Shuidihuzhu also brokers health insurance policies to members.
Most plan participants are from rural cities. Shuidihuzhu has paid out
more than 400M yuan to more than 3,000 people to date.
XIANG HU BAO
Launch: October 2018 by Ant Financial
Focus: Xiang Hu Bao is Ant Financial’s mutual aid platform, which
provides lump-sum payouts for 100 critical injuries or diseases based
on payments collected from its members. The service, which is
available to anyone 30 days old to 59 years old, has acquired over 50M
customers in less than six months.
Ant charges an 8% administrative fee for every payout and reportedly
hopes to sign up more than 300M users within two years.
45
 Mix of European insurtech startups raise growth
financing in Q1’19
HEALTH INSURANCE
Q1’19 Funding: $45M Series B // DST
Global, Index Ventures
Focus: Alan is a Paris-based startup operating as
a licensed private health insurer providing
coverage beyond the basic reimbursements
provided by France’s national healthcare system.
Alan also provides digital tools such as a maps
product to find nearby doctors. Alan grew from
5,000 policyholders to 27,000 in 2018, focusing
on freelancers and small businesses.
FRAUD
Q1’19 Funding: $60M Series C // BVP, Accel
Focus: Shift Technology is a Paris-based startup
providing software tools to detect fraudulent insurance
claims.
Shift works with more than 70 global customers
including CNA in the US, MACIF in France, and AXA in
Spain.
Shift is expanding into claims automation with a SaaS-
based solution that augments existing processes and
integrates into core systems.
INSURANCE BROKERAGE &
LIABILITY INSURER
Q1’19 Funding: $125M Series B //
Mubadala Ventures
Focus: Wefox Group is a Berlin-based startup that
owns Wefox, an insurance management app, and
One, a digital liability insurer for personal
insurance coverage.
Wefox currently serves more than 400K
customers and 1,500 brokers, with 80% of
customers on the Wefox platform coming via
brokers.
46
GLOBAL VC-BACKED
FINTECH Q1’2019

REGTECH

MACRO SECTOR
TRENDS

47
Regtech saw drop in funding but slight recovery in
deals in Q1’19
Global regtech VC-backed fintech financing trends, Q1’18 – Q1’19, ($M)
$800.0 45

39
$700.0 40

35
$600.0 31
30
30
$500.0
25
25
$400.0 21
20

$300.0
15

$200.0
10

$100.0 5

$385.1 $450.6 $546.8 $686.8 $337.8

$- 0
Q1'18 Q2'18 Q3'18 Q4'18 Q1'19
48
 REGULATORS CONTINUE TO CRACK DOWN ON BOTH INCUMBENTS AND STARTUPS

Regulators find compliance gaps

UniCredit Bank AG hit with $1.3B fine by U.S.

Justice Department A payday lender in disguise? New York
investigates the Earnin app
April 17, 2019 |
April 3, 2019 |

49
 REGULATORS ARE MORE EMBOLDENED THAN EVER

“We continue to be disappointed with Wells Fargo Bank

N.A.’s performance under our consent orders and its
inability to execute effective corporate governance and a
successful risk-management program. We expect
national banks to treat their customers fairly, operate in
a safe and sound manner, and follow the rules of law.”
March 15, 2019, OCC public rebuke of Wells Fargo Bank
March 28, 2019, Tim Sloan, Wells Fargo CEO retired

50
 Startups fight crime and counter terrorism with AI and APIs
Q1’19 Funding: $9M Series A
Select Investors: Canaan, Broadhaven
Regulations: AML, Fraud
Focus: Beam helps fintechs, banks, broker-
dealers, and cryptocurrency companies to
streamline workflows, lower false positives,
and centralize data to comply with
regulations. The company’s API-based
platform conducts transaction monitoring
with the data and helps customers
proactively identify suspicious activity.
Q1’19 Funding: $30M Series B
Select Investors: Index Ventures, Balderton
Regulations: AML, CFT
Focus: ComplyAdvantage supports a suite of
plug-and-play cloud services including REST
APIs, automated onboarding, and continuous
monitoring for compliance risks.
The company helps firms comply with
regulations relating to sanctions, anti-money
laundering (AML), terrorist financing (CFT),
bribery, and corruption.
Q1’19 Funding: $7.5M Series A
Select Investors: Jungle Ventures, Illuminate
Regulations: AML, Reconciliation
Focus: Tookitaki provides end-to-end
machine learning applications for
reconciliation. Tookitaki’s REST APIs and AI
are auditable and scalable for compliance
with financial services regulations.
51
Next-gen regtech startups are combating identity fraud
with biometric authentication and continuous monitoring
Apr’19 // $50M Series D Select Investors:
Salesforce, SBI Group
Focus: Onfido is a digital identity company that provides
verification software for background screening and
onboarding.
Onfido uses machine learning to remotely validate a person's
identity document and compares it with their facial
biometrics. The identity can then be checked against
international credit bureaus and watchlists.
Feb’19 // $30M Series C Select Investors:
Two Sigma, Santander, Flint Capital
Focus: Socure verifies digital identities by combining machine
learning with trusted datasets to authenticate identities in real time.
Socure provides services to lenders, card issuers, banks, e-
commerce, and digital payments.
In December 2018, Socure partnered with Alloy to offer financial
institutions better customer “risk scoring,” aiming to reduce the
number of false positives in fraud analysis.
52
GLOBAL VC-BACKED
FINTECH Q1’2019

PAYMENTS

MACRO SECTOR
TRENDS

53
Payments incumbents look to consolidate plumbing
and infrastructure with record M&A deals
In January 2019, Fiserv announced its $41B
acquisition of First Data
+
Fiserv provides card-based solutions for banks and
non-bank issuers.
• Combined with First Data’s merchant acquiring
services, FIS will touch end-to-end payments
chains including card issuing and core
processing, networks services, e-commerce, and
integrated payments.
• Consumers and merchants could benefit from the
augmented network and consolidated distribution
channels, tightened risk management protocols,
and expanded card-based acceptance solutions.

Source: SEC FORM 8-K 54

FIS acquires Worldpay in a ~$43B deal, the biggest
fintech acquisition of all time
In March 2019, FIS announced its $43B acquisition
of Worldpay
• FIS and Worldpay have complementary solutions
and services encompassing financial
institutions, issuing and acquiring services, and
commerce.
• Consumers and merchants will benefit from the
combined omnichannel payment & multi-
currency capabilities, robust risk & fraud
solutions, and robust data analytics.
• Worldpay has been adding key e-commerce VS.
partnerships including supporting Amazon Pay
outside of Amazon’s marketplace.

55
KLARNA IS EXPANDING GLOBALLY WITH A HYBRID PAYMENTS, CREDIT, & BANKING SUITE

Last Funding Valuation

$108M Private Equity // Q1’19 $2 - 2.5B
Klarna is a Sweden-based alternative payments
platform that aims to provide a frictionless buying
experience to buyers and sellers.

2019 announcements:
• Raised $108M in private equity from Permira and
Sequoia in April 2019
• Launched a new open banking platform that links
to 4,300 banks and a global authentication
platform
• In Q1’19, Snoop Dogg angel invested and was the
center of a new marketing campaign
• Partnered with Canada’s PayBright, adding
another 4,000 merchants to the platform
Select Investors
Permira, H&M, Sequoia Capital, Permira, DST
Global, QED
56
Fintech in Africa is growing, payments and
lending remain the top targets for deals

57
 Africa’s payments landscape is evolving similarly
to other regions through VC deals and M&A
Q1’19 Funding: Q1’19 Funding:
$150K Seed $5M Series A
Select Investors: Select Investors:
Y Combinator Y Combinator,
Khosla Ventures

Q1’19 Update: Similar to the Fiserv and FIS

Focus: Wallet.ng is a digital payments
platform that aids transactions by
allowing people to send and receive
money and also make payments using
just their phone numbers.
Focus: Kudi provides a mobile app that offers
bill payment through messaging. Features
include bill payment, bill reminders, airtime
purchase, and funds transfer.
deals, India’s FSS is looking to frontier
markets to grow their merchant acquiring
business. In March, FSS made a minority
investment in Africa’s Ecentric Payment
Systems, taking a 46% share of the company.

58
GLOBAL VC-BACKED
FINTECH Q1’2019

BANK TECH

MACRO SECTOR
TRENDS

59
 Frustrated by the Tech Industry, Small
Banks Start to Rebel Against Legacy
Core Providers FIS, Fiserv, & Jack Henry

Community lenders say their tech providers aren’t always helping them compete for deposits.
Little known outside the banking world, but their infrastructure now makes up much of the
modern banking system’s financial plumbing, especially for smaller banks.

“The cores” provide the legacy technology behind everything from keeping track of customer
deposits to powering mobile apps. The three biggest core providers today do business with 90%
of US banks with less than $1B in assets.

60
Next-gen bank cores pick up funding and fintech clients
but face high barriers to break into networked banks
Last Funding: $30M Series A Q1’19
Select Investors:
ABA, Accenture, First Data Ventures, Live Oak Ventures,
SunTrust Banks, T.N. Incorporation, Woodforest National Bank
Focus: Finxact is developing an enterprise-class public
cloud/private data Core-as-a-Service platform with a
completely open banking API. The Finxact Core will allow
banks to deliver new services for omnichannel consumers.
+
Last Funding: $5.4M Series B-II Q2’18
Select Investors:
Insight Venture Partners
2019 Developments: Nymbus is breaking into de novo banks, or
newly chartered banks. Moxy, a new DC-based de novo bank,
received a conditional charter in January 2019 and announced
the selection of Nymbus’ core banking suite.
Nymbus’ suite of services includes SmartCore and SmartLaunch,
a full-service and standalone digital brand alternative. 61
Europe sees utility players capitalize on open banking
tailwinds and bank demand for go-to-market solutions
+ Select customers:
Mar’19 // $19.7M Series B
Focus: 10x offers a suite of APIs covering process core
automation, compliance reporting, security, and analytics.
10X had a false start in 2018 after losing its largest prospect,
Virgin Money. The company got a fresh injection of funding
from Nationwide, its new marquee client.
Select Investors:
Nationwide Building Securities, Ping An Ventures
Feb’19 // $34M Series C
Focus: Mambu is a SaaS banking platform that powers digital
financial services. The company provides flexible, banking
architectures that aim to allow its clients to operate like tech
companies rather than banks. The company is based in Germany.
Select Investors:
Acton Capital Partners, Bessemer Venture Partners, Point Nine
Capital, CommerzVentures
62
From financial super app to
full-stack banking, could a
charter be next?
Ant Financial Launches Distributed Core
Banking Platform with Hoperun
Information Technology

Ant Financial has accelerated the roll-out of services that share its technological capabilities with
financial institutions. Ant is partnering with Jiangsu-based Hoperun and unveiled its Distributed
Core Banking Platform (DCBP), a next generation banking product designed to help financial
institutions shift from transaction-oriented to customer-oriented and tackle digital challenges,
including distributed development, financial product management and accounting liquidation.

To date, Ant Financial has provided more than 100 technology products and solutions and
collaborated with more than 200 service partners.

63
APPENDIX:

Q1’19 global fintech

financing trends

64
US FINTECH VC-BACKED EQUITY FUNDING IN Q1’19:

$3.3 BILLION
ACROSS

170 DEALS

65
 Q1’19 US fintech deals rebounded after three
consecutive dips, but remained below Q1’18 levels
US VC-backed fintech financing trends, Q1’18 – Q1’19 ($B)
$4.0

212
$3.5

$3.0
180
169 170
149
$2.5

$2.0

$1.5

$1.0

$0.5

$2.5 $3.4 $3.0 $3.4 $3.3

$-
Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

66
US saw a fresh crop of
US early-stage fintech deals rebounded but funding
early-stage startups dropped in Q1’19
raise funding in Q1’19 US early-stage VC-backed fintech financing trends, Q4’17 – Q4’18, ($M)

Early-stage deals took 91 of the 125

170 deals in Q1’19, representing

54% of quarterly deals. In Q4’18,
early-stage deals took 79 of 149, 90 91
or just over 53% of quarterly 85 79
deals. Though the total number
of deals grew, early-stage deals
as a percentage of the total were
flat QOQ.
The quarter continued to see
mega-rounds go to scale ups like
Acorns, Stripe, Toast, Chime, $624 $618 $518 $678 $491
among others.
Q1'18 Q2'18 Q3'18 Q4'18 Q1'19
67
California deals
New York is closing in on California as a fintech hub
dropped to 5-quarter
New York vs. California VC-backed fintech deals, Q1’18 – Q1’19
low
90
California saw deals drop to
51 in Q1’19, down 43%
compared to Q1’18. 67
62
59
New York saw 44 deals in
51
Q1’19 which was flat California
44
compared to Q1’18. 39
44 New York
38

The US saw one new fintech 31

unicorn birth, Chime, a San

Francisco-based challenger
banking startup.

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

68
ASIA FINTECH VC-BACKED EQUITY FUNDING IN Q1’19:

$875 MILLION
ACROSS

127 DEALS

69
Fintech funding in Asia fell to 5-quarter low in
Q1’19, down 59% from Q1’18
Asia VC-backed fintech financing trends, Q1’18 – Q1’19 ($M)
157
147
131 127
119

$2,159 $16,204 $1,929 $2,613 $875

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

*Spike in Q2’18 was driven by Ant Financials’ record breaking $14B round 70
China fintech deals
India tied China as a fintech deal hub in Q1’19
fell off in Q1’19
China vs. India VC-backed fintech deals, Q1’18 – Q1’19
following regulatory
tightening on online 76
71

lending
India and China both saw 29
50
deals in Q1’19. 49

China saw deals drop to a 5-

quarter low.
29 28 29 China
India deals were flat 22
29
India
compared to the same quarter 18
a year prior.

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 71

India overtook China
India beat China as a fintech funding hub in Q1’19
in funding as China
China vs. India VC-backed fintech deals, Q1’18 – Q1’19
fintech funding fell
off in Q1’19
India saw funding top $286M
while China only saw $192M
in Q1’19.
China fintech funding hit a 5-
quarter low.

India
China

$285.6

$192.1
$225.1
$1,544.5

$1,451.0

$1,091.8

$1,829.7
$428.2

$454.3

$397.6
Q1'18 Q2'18 Q3'18 Q4'18 Q1'19
72
EUROPE FINTECH VC-BACKED EQUITY FUNDING IN Q1’19:

$1.7 Billion
ACROSS

102 DEALS

73
Fintech deals in Europe decline, as funding hits
$1.7B in Q1’19
Europe VC-backed fintech financing trends, Q1’18 – Q1’19, ($M)
120

103 102

86
82

$1,083 $942 $805 $804 $1,713

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

74
Europe overtook Asia in funding in Q1’19
Global VC-backed fintech funding by continent, Q1’18 – Q1’19 , ($M)
$16,204

$3,484 $3,572 $3,492 North America

$3,121
$2,595
$2,613
$2,159 $1,929 $1,713 Europe
$942 $804
$1,083 $805
$875 Asia

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

North America Asia Europe

*Spike in Q2’18 was driven by Ant Financials’ record breaking $14B round 75
The UK and Germany
The UK leads as Europe’s top fintech market for funding,
went head-to-head in despite Brexit uncertainty
funding in Q1’19 UK vs. Germany VC-backed fintech funding, Q1’18 – Q1’19 ($M)

The UK led as the top fintech UK

market in Europe with $645M Germany
invested across 42 deals.
Germany was the second top
market in Europe, with $588M
invested across 15 deals.
Germany saw the largest
funding round in Europe in
Q1’19, a $300M investment to
N26. The deal valued the
$259.7

$552.0

$130.4

$531.2

$175.9

$462.5

$168.9

$395.6

$588.4

$645.0
challenger bank at $2.7B,
making it Germany’s first
fintech unicorn. Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

76
 Most active
fintech investors

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#AhaCBI
The most active fintech VCs from Q1’18 – Q1’19
By unique fintech company investments (new or follow-on)
Rank Investor Select Fintech Investments

78
The most active fintech VCs from Q1’18 – Q1’19
By unique fintech company investments (new or follow-on)
Rank Investor Select Fintech Investments

79
 Methodology
CB Insights encourages you to review the methodology and definitions employed to better understand the numbers presented in this
report. If you have any questions about the definitions or methodological principles used, we encourage you to reach out to CB Insights
directly. Additionally, if you feel your firm has been under-represented, please send an email to info@cbinsights.com and we can work
together to ensure your firm’s investment data is up to date.
What is included: What is excluded:
― Equity financings into emerging fintech companies. Fundings must be put into VC-backed — No contingent funding. If a company receives a commitment for $20M subject to hitting
companies, which are defined as companies who have received funding at any point from certain milestones but first gets $8M, only the $8M is included in our data.
venture capital firms, corporate venture groups, or super angel investors.
— No business development / R&D arrangements, whether transferable into equity now, later, or
― Fundings of only private companies. Funding rounds raised by public companies of any never. If a company signs a $300M R&D partnership with a larger corporation, this is not equity
kind on any exchange (including Pink Sheets) are excluded from our numbers, even if they financing, nor is it from a venture capital firm. As a result, it is not included.
received investment by a venture firm(s).
— No buyouts, consolidations, and/or recapitalizations. All three of these transaction types are
― Only includes the investment made in the quarter for tranched investments. If a company commonly employed by private equity firms and are tracked by CB Insights. However, they are
does a second closing of its Series B round for $5M and previously had closed $2M in a excluded for the purposes of this report.
prior quarter, only the $5M is reflected in our results.
— No private placements. These investments, also known as PIPEs (Private Investment in Public
― Round numbers reflect what has closed — not what is intended. If a company indicates Equities), are excluded even if made by a venture capital firm(s).
the closing of $5M out of a desired raise of $15M, our numbers reflect only the amount
— No debt / loans of any kind (except convertible notes). Venture debt or any kind of debt / loan
which has closed.
issued to emerging startup companies, even if included as an additional part of an equity
― Only verifiable fundings are included. Fundings are verified via various federal and state financing, is not included. If a company receives $3M with $2M from venture investors and
regulatory filings, direct confirmation with firm or investor, or press release. $1M in debt, only the $2M is included.
― Previous quarterly VC reports issued by CBI have exclusively included VC-backed rounds. — No government funding. Grants, loans, or equity financings by the federal government, state
In this report, any rounds raised by VC-backed companies are included, with the agencies, or public-private partnerships to emerging startup companies are not included.
exceptions listed.

80
WHERE IS ALL THIS DATA FROM?

The CB Insights platform

has the underlying data
included in this report

app.cbinsights.com/signup

81